Supreme Court's Enron ruling may unplug charges in Wittig-Lake trial

A federal judge has asked lawyers in the criminal case against two former Westar Energy Inc. executives to assess how a recent U.S. Supreme Court ruling will affect their coming trial.

Judge Julie Robinson gave lawyers for David Wittig and Douglas Lake and prosecutors until July 9 to file briefs with the U.S. District Court in Kansas City, Kan., to argue whether the two should face wire fraud and money laundering charges. The directive came days after the Supreme Court ruled on an appeal by former Enron Corp. President Jeffrey Skilling.

In that June 24 ruling, justices sharply narrowed the scope of “honest services” fraud, a statute that makes it a crime to deprive someone of “the intangible right of honest services.” The ruling limits the fraud to bribery and kickback schemes.

Bribery and kickback schemes are not alleged in the third trial that Wittig and Lake face on claims that they looted the Topeka-based utility for personal use.

Jean Paul Bradshaw, a Lathrop & Gage LLP lawyer and former U.S. attorney, said the Supreme Court ruling could affect provisions of some of the charges Wittig and Lake face.

“If there’s a theft of honest services count, it absolutely would,” he said.

Both are charged with, among other things, wire fraud and money laundering, in part by defrauding Westar and shareholders of “the intangible right to honest services.”

Jim Wyrsch, a defense lawyer with Wyrsch Hobbs & Mirakian PC, said the Supreme Court ruling will cut back on the government’s use of wire fraud counts in white-collar cases.

“No longer will they be able to charge somebody with a crime based on the violation of their fiduciary duty,” he said.

Pat McInerney, a Husch Blackwell Sanders LLP lawyer representing Lake, and Jim Cross, a spokesman for the U.S. Attorney’s Office in Kansas, declined to comment.

Wittig and Lake’s first trial resulted in a hung jury in 2004. They were convicted in 2005, but their convictions were reversed on appeal in 2007.